Warpaint London plc (LON:W7L), the specialist supplier of colour cosmetics and owner of the W7 and Technic brands has provided an update on trading for the year ended 31 December 2021.
The Company announced in its trading update on 2 November 2021, sales for the year ending 31 December 2021 were expected to be similar to those achieved in 2019 (2020: £40.3 million, 2019: £49.3 million), the most recent financial year that experienced no impact from the Covid-19 pandemic. Following completion of the year, the Company is now pleased to report that unaudited sales for the year ended 31 December 2021 have exceeded those achieved in 2019 at £50 million.
Gross margins for the year ended 31 December 2021 were maintained ahead of those achieved in 2020 and 2019 at approximately 33.8% (2020: 31.1%, 2019: 33.5%), despite increased costs in the supply chain, particularly in respect of freight.
For the year ended 31 December 2021, subject to audit, the Group’s Adjusted EBITDA*is expected to be approximately £7.7 million (2020: £4.2 million, 2019: £7.0 million) and Adjusted Profit Before Tax** (2020: £2.3 million, 2019: £5.2 million) is expected to be approximately £6.6 million, both of which are ahead of market expectations.
The Company’s cash balances as at 31 December 2021 totalled £4.1 million (31 December 2020: £4.9 million) and the Company had no debt, after significant stock purchases to satisfy anticipated Q1 2022 demand.
Warpaint expects to release its results for the year ended 31 December 2021 in April 2022.
* Adjusted for foreign exchange movements, share based payments and exceptional items.
** Adjusted for exceptional costs, amortisation of intangible assets, and share based payments. Adjusted numbers are close to the underlying cash flow performance of the business which is regularly monitored and measured by management.
Commenting, Sam Bazini Warpaint London Chief Executive, said: “I am pleased to report that we ended 2021 ahead of current market expectations. In 2021 we enjoyed particularly strong sales growth in the UK, significant growth internationally and further increases in online sales. It was pleasing that we were able to maintain our margins at pre-pandemic levels, despite some inflationary headwinds, particularly with freight costs.
“We expect to see a continuing improvement in performance in 2022 and have started the year strongly. In line with our stated strategy we have significant opportunities for further growth, both with our existing retailers, and those such as Boots where we are expecting to launch very shortly, together with others that we are in discussions with. I look forward to providing further updates at the time of the release of the Group’s results in April.”
